“Universal Music Group said Thursday it will sell digital music… without the customary copy-protection technology [DRM] for a limited time,” Alex Veiga reports for The Associated Press.

Tracks from thousands of albums will be available for purchase on the recording artists’ Web sites and through several established online music retailers, although Universal is excluding Apple Inc.’s iTunes store, the No. 1 online music retailer,” Veiga reports. “The songs, however, will play on Apple’s market-leading iPods, as well as the slew of other devices compatible with the MP3 format.”

“The test by Vivendi SA’s Universal Music Group, while only encompassing a portion of its catalog, is significant because Universal is the world’s largest recording company. That raises the prospect that other major labels could follow,” Veiga reports.

“Universal Music spokesman Peter LoFrumento said… that the company isn’t selling DRM-free tracks on iTunes for now so it could use the Apple store as a control group for measuring the impact on pricing, piracy and sales,” Veiga reports.

“Universal Music will make DRM-free songs available Aug. 21 to Jan. 31,” Veiga reports. “Among the online retailers that will be selling the tracks are Amazon.com Inc., Google Inc., Wal-Mart Stores Inc., Best Buy Co., RealNetworks Inc.’s Rhapsody, Transworld, PassAlong Networks and Puretracks Inc., according to Universal. The retailers are expected to sell the tracks for 99 cents and in a variety of bit rates. Universal will be offering the tracks in the MP3 format, but the retailers will be free to sell the tracks in any DRM-free format they choose.”

Jeff Leeds reports for The New York Times, “The effort is likely to be seen as part of the industry’s wider push to increase competition to iTunes and shift leverage away from Apple, which wields enormous influence over prices and other terms in digital music. A month ago, Universal notified Apple that it would not agree to a new long-term contract to sell music through iTunes.”

“So far, only one of the four major music companies, the EMI Group, embraced a wholesale shift away from the usual approach. EMI, which releases music by artists like Norah Jones and Coldplay, first struck a deal with iTunes in which songs without copy protection (and with better audio quality) would be sold at a higher price — $1.29 instead of the usual 99 cents for the restricted songs,” Leeds reports.

Jupiter Research analyst Michael Gartenberg blogs, “The handwriting for DRM is on the wall. Universal is using this to clearly poke Apple with a sharp stick… The question is will Apple customers go through a little more effort to get their content in DRM free format and start dealing with other music vendors. DRM meant that music players would drive customers to the music store that works with it, DRM free content that everyone EXCEPT Apple has can potentially change that dynamic for the first time.”

[Thanks to MacDailyNews Readers “Edgy” and “Ken” for the heads up.]
Make no mistake, this is Universal’s attempt — a rather weak one at that — to artificially prop up also-ran online music outfits that could not compete on a level playing field against Apple’s iTunes Store. So, Universal will try to tilt the field a little. Universal — and most of the rest of the music industry — fears Apple’s rapidly intensifying power. The fact is, Apple’s iTunes Store was responsible for close to 15% of Warner Music’s revenue last quarter (see related article below).

Universal is treating their iTunes customers like lab rats in an experiment. They want to see what, if anything, they can squeeze out of Apple CEO Steve Jobs (remember, they dream the impossible dream of iPod royalties every night).

By the way, this “control group” nonsense is just that: nonsense. If you want to test out how DRM-free music sells in relation to your DRM tracks, just do as EMI did and sell them via Apple’s iTunes Plus. Sell DRM’ed and non-DRM tracks side-by-side. That’ll tell you all you need to know. The “control group” is just B.S. cover for Universal. They want their DRM-free music sales to fail.

So, what do you think, will Universal be able to dent Apple iTunes Store’s dominance with this little stunt? Will Apple do anything to retaliate?

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73 Comments

The thing about EMI’s deal with iTunes is that you know what you’ll be getting: high quality DRM-free tracks that have been mastered and optimized using the AAC codec.

It sounds as if Universal is just turning their music over to these also-rans and letting them put it in any format (and bit rate?) they want. How can you be guaranteed quality if these tracks aren’t mastered from trustworthy sources?

And even if that weren’t an issue, I really don’t feel like going through the trouble of turning all of my credit card and identity information over to another online music store. I want to buy my tracks from iTunes because I trust Apple and we’ve had a good thing going for a long time now.

The only people who will go to the trouble (or have the knowledge) to get tracks somewhere else, then put them in to iTunes are the people who pirate music in the first place. If they can get it for free somewhere else, why pay for it?

MW: “former” as in Universal is the former largest music label. Its hey day was during the era of the compact disc.

Apple should simply strike from its catalog any DRMed music that Universal is selling non-DRMed elsewhere, for such a move is Universal being deceptive to iTunes customers. Or if it remains in the catalog, Apple should take the high road and inform the customer that Universal refuses to sell the non-DRMed version on iTunes but is willing to sell it elsewhere.

If Universal tries to trick some of its customers, Apple should be free to protect its customers.

That should screw up the control group and expose Universal for what it is really trying to do.

I recently decided to take eMusic up on all of the offers I’m always seeing for 25 free tracks. I signed up, got my 25 free tracks and cancelled my account. The thing is, I wouldn’t have wanted to use it regardless of my allegiance to Apple. It was a pain. The thing these guys are missing is, iTS is simply better than the rest. Get over it.

I’m perplexed by the tone of the article suggesting that DRM is something that Apple forced on the poor record companies to the detriment of the consumer. Of course nothing could be further from the truth. After trying to shaft consumers in every way shape and form, the recording industry is going to ride in and save us from a situation THEY created?

Apple created the iTunes music Store so that legal music would be available for the iPod. Yes, you can rip and burn, but Steve knew a long time ago that digital downloads were the wave of the future and without the ITMS everything would have been in the “plays-for-sure” format.

No DRM means you can buy anywhere and still play it on your iPod, with no Microsoft lockout from its proprietary formats.

They are playing right into Steve’s hands. Besides, none of those stores will have the easy of use or mind share of the ITMS. They will have crazy variable pricing, confusing formats and bit rates, lousy navigation, and crappy software next to iTunes. Besides, all that music will be going straight to an iPod anyway.

I’m not giving my credit card number or anything else to the Russians (read mafia). Might be a good time to check your credit card bill and credit rating, or you might find out that you bought a new car in Moscow.

Haha, I love seeing you pathetic Apple fanboys get yourselves worked into a sweaty rage over Univeral’s decision not to sell DRM-free tracks through iTMS. You must have some incredibly perverse obsession with wanting to put money into Steve Jobs’ pockets. Only problem here is, most of your arguments don’t hold any water.

Danwayff:
“Name one good band on Universal.”

You can tell me with complete honesty (cross your heart and hope to die) that you do not like the music of even one artist signed to Universal?

Zorrin:
“It sounds as if Universal is just turning their music over to these also-rans and letting them put it in any format (and bit rate?) they want.

First of all, you don’t know that. And hey, guess what? iTMS tracks aren’t as high quality as the tracks on a CD. And CD tracks aren’t as high quality as vinyl. So now what, you’re going to stop buying from iTMS and start buying vinyl exclusively again?

Zorrin & Crack Smoking Music Lover:
“I trust Apple and we’ve had a good thing going for a long time now.”

Amazon’s not a trustworthy company? Google’s not a trustworthy company?

choc:
“The only people who will go to the trouble (or have the knowledge) to get tracks somewhere else, then put them in to iTunes are the people who pirate music in the first place. If they can get it for free somewhere else, why pay for it?”

Wow… so all of those people who rip CDs they own, purchase tracks from eMusic (second largest online music retailer), and all of the people who download tracks that the artists themselves release on the web for free are considered pirates now! Nice try, but no.

Too smart 4U:
“Well, Universal.drop dead. I won’t be able to buy music from the iTunes Store?”

Again, what is with the obsession of wanting to only give your money to Apple?

Apple should play games with Universal Music too by not “featuring” Universal Music artists. UM artists could be a “control” group of how well music sells when it is not promoted versus all the other music which is promoted.

And Apple, please – get 50 Cent’s off of your startpage and off of the top of iTunes. Not only will you be cleaning up the sites but you’ll also be poking a stick at UM. Two for one – not a bad deal.